The Bank of Korea's(BOK) rate-setting monetary policy board, which kept the key interest steady at three-point-five percent on Thursday, said austerity will continue for a considerable time with a focus on stabilizing consumer prices.

In a letter of resolution from the session in the morning, the policy board forecast inflation, which has stagnated, to climb back to around three percent after August and exceed the targeted two-percent range for quite some time.

As for a further rate hike, the board said it will make a decision while monitoring the slowing of inflation, financial stability risks, downside risks in growth, the ripple effect of a rate hike, the monetary policies of major economies and changes in household debt.

On the domestic economy, the board forecast growth to improve, citing recoveries in consumption and exports as the reason for maintaining its outlook at one-point-four percent for this year.

They still cited economic trends in China, the ripple effect on South Korea, trends among major economies, and the timing of recovery in the IT sector as causes of uncertainty.